Choosing an Energy Avenue

According to the U.S. EPA’s Landfill Methane Outreach Program, there are about 555 operational landfill gas-to-energy projects in the U.S., and more than 500 additional landfills have been identified as potential candidates for projects. If each one seized its opportunities, LMOP estimates the total gas generation potential to be 210 billion cubic feet per year, or 1,165 MW of renewable electricity. More landfill owners—as well as owners of other methane-emitting operations—are beginning to weigh their options, and each and every detail must be carefully considered to determine the best energy model. That model may be the most common avenue taken—electricity production—or high-Btu pipeline injection, which is far less common but is beginning to garner more attention.

Out of the 550-plus LFG-to-energy projects in the country, about 30 of them are injecting renewable natural gas into the pipeline, and several more are in development. Texas-based Element Markets is developing one in Amsterdam, Ohio, at the APEX Sanitary Landfill. The landfill, which covers approximately 1,285 acres in Jefferson and Harrison counties, receives about 1.8 million tons of waste per year and is one of the fastest-growing landfills in the U.S. Randy Lack, chief marketing officer of Element Markets, says the project will generate more than 32 million Btu (MMBtu) of bio-methane through its operational life of 20-plus years.

Construction is underway on the well field where Element Markets is expanding the system for eventual tie-in to the gas processing plant, and a lateral pipeline will be constructed to connect to an interstate pipeline.

While landfills represent a considerable chunk of those taking advantage of pipeline injection, it can also be an option for certain wastewater treatment plants and anaerobic digestion facilities.

Leading by Example

The Huckabay Ridge Anaerobic Digestion Project in Stephenville, Texas, is a rare but successful example of an animal manure-based AD facility injecting renewable natural gas into the pipeline. The facility, which is the largest AD project in North America, consists of eight giant cement tanks with a working capacity of 6.8 million gallons, processing more than 26 million gallons of manure, glycerin, grease trap and other organic waste each year. Owned by Element Markets, the facility has been operating since 2006 and the RNG generated at the site is injected into an intrastate pipeline where it is sold to a large California utility.

In the realm of wastewater treatment plant energy projects, pipeline injection is slowly becoming a trend. San Antonio Water System and Ameresco opened the first such project in the U.S. at the Dos Rios Water Recycling Center in September 2010. There, Ameresco treats and delivers up to 1,060 standard cubic feet per minute of biogas to the natural gas market. SAWS invested about $1 million in pipelines and structures, according to Michael Bakas, Ameresco senior vice president of renewable energy. Not only do the rate payers receive royalties of around $200,000 per year, but the biogas plant will have paid for itself in as few as five years.

But for a wastewater treatment plant like the Philadelphia Water Department, which recently teamed up with Ameresco for a $47.5 million, 5.6 MW electricity project, pipeline injection isn’t the right fit. So why might a project choose pipeline injection over electricity production, or vice-versa? “In choosing pipeline injection, the quick answer is that with electricity generation, you’re really limited to the local market,” Lack explains. “Renewable natural gas flows fluidly through natural gas pipelines, and the pipeline system in the U.S. is robust.”

From there, RNG can be taken to the market where it has the most value. “Electricity can only flow limited distances because of the way it works and the way the network is built,” Lack says. “Once RNG is in the pipeline, it can flow very long distances.”

According to the U.S. Energy Information Administration, there are more than 210 natural gas pipeline systems in the U.S. and 305,000 miles of interstate and intrastate transmission pipelines. While RNG may be able to reach long distances through the pipeline system, actually getting it into the pipeline can be challenging. “It’s not as if you can say, ‘I have gas and I want to get it into the pipeline,’ Lack says. “That’s not how it works; you really have to clean it up and compress it, and in a lot of areas you might not even be able to get into the pipeline because the specifications are so tight. There are a lot more challenges in trying to meet the quality climates of the pipeline carriers using landfill gas.”

With power prices dropping and the market for RNG growing, some operations are taking advantage of that, even though the necessary gas clean up is a much more complicated process compared with a conventional engine with moderate cleaning. “Some companies have developed technologies over the past five to seven years that have really advanced the potential for gas clean up,” Lack says. “It’s very difficult to remove nitrogen and some of the oxygen, and these newer technologies do a good job of it, whereas traditional gas processing technologies only treat CO2.”

On the other hand, the currently low prices of natural gas can pose a challenge to pipeline projects, according to Bakas. “Prices at the wellhead right now are $2.50 per MMBtu, so the economics aren’t that supportive right now,” he says.

And there are still a number of other variables that have to come to bear for landfill gas projects to be technically feasible, according to Bakas.

Analyzing the Details

“You have to look at all sorts of technology applications when looking at [best options for] these projects,” Bakas says. “You need to look at the macro conditions and what’s going on in the economy to determine what you’re dealing with.”

With landfills specifically, there is a lot more variability in the volume of gas, compared to biogas projects that opt for pipeline injection. “There are a lot more disruptions in landfill gas supply, and that’s just the nature of the process of landfilling, but it makes it more challenging to try to meet quality specifications for high-Btu,” he says.

The project’s location is also a key factor in determining the correct energy model, according to Bakas. “Landfills in particular are located in remote areas and not necessarily close to a host facility, so we’ll find you’ll have to go a good pipeline distance away to bring the gas to a host. The only other solution may be to put the electricity to the grid.”

Mark Warren, director of safety and marketing at Morrow Renewables, says a key indicator to determine if a landfill is a good candidate for the high Btu model is whether it takes in 250,000 tons of waste or more per year. “They’ll find the high-Btu model a little more profitable over the long run,” he says. That is, of course, taking into account the project’s proximity to a pipeline or electrical grid.

Although there are about 10 landfill gas electricity projects for every one high-Btu project, Warren says the high-Btu model was actually the original means of converting landfill gas to energy. “It was only since the early 1980s that electricity became the prevalent model,” he explains. “Obviously there’s been a lot of technology development since then.”

Morrow Renewables, formerly known as SouthTex Renewables, built the Huckabay Ridge AD project before selling it off to Element Markets. The company now focuses almost exclusively on landfill gas-to-high-Btu projects, and holds a patent on CO2 stripping of pretreat solvent, and two patents pending for deeper stripping of solvent to achieve higher methane purity in sales gas.

Warren says that while a lot more planning goes into pipeline projects, it doesn’t take as long to actually build the plant—about nine months to build a pipeline facility from the notice to proceed, compared with roughly two years for a power project. “It does take longer to produce profits because it takes a while for trash to break down and produce landfill gas in quantities that you can pull enough methane out,” he says, adding that there are ways to speed up the process.

In some places, pipeline projects might have the upper hand, requiring fewer permits because of their cleanliness compared with electricity projects. “They’re definitely a cleaner solution,” Warren says. “You don’t have to purify your landfill gas at all for it to be able to run through generators for electricity production, which is kind of a messy operation. You’re dealing with heavy particulates, diesel emissions, and a lot of CO2 going back into the environment with that production model. And a lot of people fail to foresee how much is involved in maintaining and repairing the heavy equipment that goes along with the electricity model.”

Processed gas can be transported to higher-priced renewable energy credit markets in most cases, Warren adds, which offers much better economics to the project owner. He admits the low price of natural gas does affect the economics of a pipeline project somewhat, but says there are ways to increase the efficiency of a project that will help balance it out.

Overall, a strong feasibility analysis should be able to determine which option will be more profitable. “It all goes back to the size of the landfill, and oftentimes the upfront cost of building the facility,” Warren says. Morrow Renewables sets up a separate company for each project and acquires the lease rights, so in most cases there are no upfront costs to partners. “With a high-Btu plant, we cut them a monthly royalty check on the back end. We will engineer, manufacture, install and operate the facility.”

Warren points out that landfills around the world produce the lion’s share of human-induced methane, and there has been new attention on methane as a short-term method of reducing global warming. “I think there will be an emphasis on this in the future and a lot of landfills could really profit from it,” he adds. “Out of the 500-plus landfills that are candidates for energy projects, how many are suited for high-Btu models verses electricity production? I don’t think anyone has the answer, but we’re finding out one landfill at a time.”